Category Archives: homes in sacramento

‘Old Millennials’ Are Diving Head-First into Homeownership [INFOGRAPHIC]

‘Old Millennials’ Are Diving Head-First into Homeownership [INFOGRAPHIC] | MyKCM

Some Highlights:

  • ‘Old Millennials’ are defined as 25-36 year olds according to the US Census Bureau.
  • According to NAR’s latest Profile of Home Buyers & Sellers, the median age of all first-time home buyers is 31 years old.
  • More and more ‘Old Millennials’ are realizing that homeownership is within their reach now!

Is the Current Pace of Home Sales Sustainable?

Is the Current Pace of Home Sales Sustainable? | MyKCM

There are some experts questioning whether the current pace of residential home sales is sustainable. Are too many people buying homes like in 2004-2006? Are we headed for another housing crisis? Actually, if we look closely at the numbers, we can see that we are looking at a very healthy real estate market.

Why the concern?

Some are looking at the last three years of home sales and comparing them to the three years just prior to the housing bubble. Looking at the graph below, we can understand that thinking.

Is the Current Pace of Home Sales Sustainable? | MyKCM

However, if we go further back in history, we can see the real picture. After taking out the “boom & bust” years, the pace of sales is growing at a quite natural pace.

Is the Current Pace of Home Sales Sustainable? | MyKCM

And new home sales are way below historic numbers.Trulia’s Chief Economist Ralph McLaughlin explains:

“Adjusted for population, [new home sales] are at about 63% of their fifty-year average level—way better than 2011, but nowhere near heated.”

Bottom Line

The current pace of residential home sales definitely seems sustainable.

10 Tips for First-Time Home Buyers

Tips Fpr Buyers

What You Should Know Before Buying a Home

(Courtesy of http://www.calhfa.ca.gov)

1. Before you start looking for a home, get pre-qualified for a loan. Banks, credit unions and mortgage bankers make home loans; mortgage brokers process them. The lenders will take an application, process the loan documents, and see the loan through to the funding stage.

2. If you have marginal or bad credit, consult your lender. You may be able to qualify for a loan depending on how long ago and what reason(s) caused the bad credit. A lender should be able to advise you on whether your credit history will prevent you from qualifying for a home loan.

3. You will need a down payment. Down payment requirements vary depending on the type of loan. Many down payment assistance programs exist. These programs may loan or grant you the funds necessary for the down payment. Consult with a lender about programs available in your area.

4. You will need funds for closing costs Closing costs are charges for services related to the closing of your real estate transaction. They include, but are not limited to:

  • Escrow fees charged by the company handling the transaction
  • Title policy issuance fees charged by the title insurance company
  • Mortgage insurance fees
  • Fire and homeowners insurance
  • County Recorder fees for recording your deed
  • Loan origination fees
  • Consult your lender for an actual estimate of these costs, as well as information about loan programs which can assist in financing your closing costs

5. Some loans have “points” and some do not. A point is a loan origination fee equivalent to 1% of the loan amount. Together with the interest rate they constitute the yield on your loan for the lender. Some lenders charge a higher interest rate to compensate for charging no points. It is important to comparison shop lenders to make sure your loan is at a competitive yield.

6. Should you select a mortgage with a fixed rate or an adjustable rate? The answer to this question depends on whether mortgage rates are at a high or a low point when you purchase, and on how long you plan to live in the home. If rates are high, an adjustable rate might be attractive since subsequent rate drops could reduce your monthly payments. Additionally, lenders may offer a low rate during the first few years of an adjustable mortgage to make it appealing to you. If interest rates are low you might want to take a fixed rate to protect yourself against the possibility of rising interest rates.

7. Be aware of the two main types of loan categories.
Conventional Loans. Conventional mortgage loans are available with fixed or adjustable interest rates. Some loans may require mortgage insurance.
Government Loans. These include Federal Housing Administration (FHA) fixed and adjustable rate mortgage loans, and Veterans Administration (VA) fixed rate mortgage loan

8. If you are a low or moderate income homebuyer, there are special programs designed to help you. These loans are available through private lenders, as well as local and state housing agencies, like the California Housing Finance Agency (CalHFA). Most lenders specializing in real estate mortgage loans are aware of these types of loan programs.

9. Why might I have to pay mortgage insurance? Mortgage insurance protects the lender from potential loss if you should default on your mortgage loan payment. Generally, conventional loans that require larger down payments do not require mortgage insurance. Mortgage insurance is always required on FHA mortgage loans.

10. Many organizations offer home loan counseling to prospective homebuyers. These organizations provide classes for homebuyers to cover the steps to homeownership. They will cover home selection, realtor services, lenders, loan programs, homeownership responsibilities, saving for a down payment, and other important pieces of information. Many homebuyer programs require homebuyers to attend this type of class to be eligible for selected programs.

Homeowner’s Net Worth is 45x Greater Than a Renter’s

Homeowner’s Net Worth is 45x Greater Than a Renter's | Keeping Current Matters

Every three years the Federal Reserve conducts a Survey of Consumer Finances in which they collect data across all economic and social groups. The latest survey, which includes data from 2010-2013, reports that a homeowner’s net worth is 36 times greater than that of a renter ($194,500 vs. $5,400).

In a Forbes article the National Association of Realtors’ (NAR) Chief EconomistLawrence Yun predicts that in 2016 the net worth gap will widen even further to 45 times greater.

The graph below demonstrates the results of the last two Federal Reserve studies and Yun’s prediction:

Homeowner’s Net Worth is 45x Greater Than a Renter's | Keeping Current Matters

Put Your Housing Cost to Work For You

Simply put, homeownership is a form of ‘forced savings’. Every time you pay your mortgage you are contributing to your net worth. Every time you pay your rent, you are contributing to your landlord’s net worth.

The latest National Housing Pulse Survey from NAR reveals that 85% of consumers believe that purchasing a home is a good financial decision. Yun comments:

“Though there will always be discussion about whether to buy or rent, or whether the stock market offers a bigger return than real estate, the reality is that homeowners steadily build wealth. The simplest math shouldn’t be overlooked.”

Bottom Line

If you are interested in finding out if you could put your housing cost to work for you by purchasing a home, meet with a real estate professional in your area who can guide you through the process.

Homeownership Finally Makes Political Debate

Homeownership Finally Makes Political Debate | Keeping Current Matters

This is not a political post!

Finally, the issue of homeownership has become a platform talking point in this year’s presidential debate. Yesterday, one of the candidates running for President spoke out about the importance of homeownership in America.

Hillary Clinton detailed a new economic agenda yesterday. In announcing her new agenda, she remarked:

“Homeownership is about more than just owning a home. It is about putting roots down in a community with better schools, safer streets and good jobs. And it is about building wealth, as homeowners build equity in their home one mortgage payment at a time…We must make sure that everyone has a fair shot at homeownership.”

This post isn’t political!

It doesn’t matter that it was Clinton who said it first. It doesn’t matter that she is a Democrat.

What matters is that EVERY candidate for our country’s highest office realizes the important role homeownership plays in the development of our nation.

The fact that homeownership was finally brought to the forefront of the debate is great news – no matter which way you lean politically.

Thinking of Selling Your Home? Get Ready to Negotiate!

Thinking of Selling Your Home? Get Ready to Negotiate! | Keeping Current Matters

Now that the market has showed signs of recovery, some sellers may be tempted to try and sell their home on their own (FSBO) without using the services of a real estate professional.

Real estate agents are trained and experienced in negotiation. In most cases, the seller is not. The seller must realize their ability to negotiate will determine whether they can get the best deal for themselves and their family.

Here is a list of some of the people with whom the seller must be prepared to negotiate if they decide to FSBO:

  • The buyer who wants the best deal possible
  • The buyer’s agent who solely represents the best interest of the buyer
  • The buyer’s attorney (in some parts of the country)
  • The home inspection companies, which work for the buyer and will almost always find some problems with the house.
  • The termite company if there are challenges
  • The buyer’s lender if the structure of the mortgage requires the sellers’ participation
  • The appraiser if there is a question of value
  • The title company if there are challenges with certificates of occupancy (CO) or other permits
  • The town or municipality if you need to get the COs permits mentioned above
  • The buyer’s buyer in case there are challenges on the house your buyer is selling
  • Your bank in the case of a short sale

Bottom Line

The percentage of sellers who have hired a real estate agent to sell their home has increased steadily over the last 20 years. Meet with a professional in your local market to see the difference they can make in easing the process.

Homeownership Still Part of the American Dream

Homeownership Still Part of the American Dream | Keeping Current Matters

The National Association of Realtors (NAR) just released the first edition of theirHousing Opportunities and Market Experience Survey (H.O.M.E.). NAR explained that the report covers:

“…core topics that will be tracked on a monthly basis such as views on housing as a good financial investment, whether homeownership is part of the American Dream…”

The current survey confirmed two long standing beliefs regarding homeownership:

1. Americans at every income level believe homeownership is part of the American Dream

Homeownership is a Part of the American Dream | Keeping Current Matters

2.)  Americans at every age believe that homeownership is a good financial decision

Homeownership is a Good Financial Decision | Keeping Current Matters

Bottom Line

Americans in all age groups and income levels believe in homeownership as a piece of their American Dream. If you are ready and willing to buy your dream home, meet with a local real estate professional who can help you determine if you are able to.

Home Prices: Past, Present & Future

Home Prices: Past, Present and Future | Keeping Current Matters

CoreLogic released their most current Home Price Index last week. In the report, they revealed home appreciation in three categories: percentage appreciation over the last year, over the last month and projected over the next twelve months.

Here are state maps for each category:

The Past – home appreciation over the last 12 months

Home Prices Past | Keeping Current Matters

The Present – home appreciation over the last month

Home Prices Present | Keeping Current Matters

The Future – home appreciation projected over the next 12 months

Home Prices Future | Keeping Current Matters

Bottom Line:

Homes across the country are appreciating at different rates. If you plan on relocating to another state and are waiting for your home to appreciate more, you need to know that the home you will buy in another state may be appreciating even faster.

Meet with a local real estate professional who can help you determine your next steps.

Why Does A Seller Need to Know How I’m Financing My Purchase: What’s the Best Financing Method?

Puzzled LookAs a buyer, have you wondered why is what type of financing you use important? Or why does the seller need to know how you are financing your purchase? Or both?

The type of financing you use is important because, as a seller, you have the right to know how someone plans to purchase your property as well as to see evidence of that person’s ability to purchase. In addition, certain types of financing may not be accepted.

As a seller, you can choose what financing terms you will accept or will not accept. Most sellers are, of course, open to as many financing types as possible. However, in rare instances, specific financing types are sometimes prerequisites to being able to make an offer to purchase. For example, pending HOA litigation in a condo development would trigger this prerequisite. The HOA company will only allow sellers to accept owner occupied buyers with all cash offers or conventional financing.

Additionally, financing has its strengths and weaknesses. A general rule is outlined below recognizing there are always exceptions, and the seller has the final say.

STRONGEST
Cash
Conventional Loan
FHA Loan
FHA with DPA (Down Payment Assistance)
VA Loan
WEAKEST

As you can see, cash is at the top of the list – it is still and will always be king. The VA loan is at the bottom of the list and it is bitter sweet.

Nicknamed the “No-No Loan” the VA loan is structured to be a great tool and benefit to allow our vets to become homeowners. No down payment, no closing costs. The VA buyer isn’t even allowed to pay certain costs associated with closing the loan. Sounds great in theory, however, those costs get passed on most times to the seller who gets to say yes or no to paying them. In a competitive market, this offer gets placed on the bottom of the pile because the seller is netting the least from these offers.

The other loans in between have varying resemblances to the VA loan because they require the seller to give up potential proceeds to make the loan happen for the buyer.

Ultimately, the more cash the buyer puts in, the more of the risk they are taking. The less cash the buyer puts in, the less risk. To a seller, the seller would rather see more risk to ensure your commitment and to increase the possibility of closing.

The above is offered as a guideline and is not set in stone as to what will always happen. There are many other ways your broker/agent can ensure you are making a strong offer no matter what your financing. In all that you do as a buyer, choosing a savvy broker/agent will ensure you are making the strongest offer for your money and budget.

JUST LISTED: $212,000 – 6912 Tierra Green Way 3 Bedrooms 2 Baths, 1395 sq ft

DSC00397

 

Pride of ownership – one owner and it shows. In the community of Florin Glen, this 3 bedroom 2 bath one-story is ready for a wonderful new owner. Popular open floor plan concept reveals a spacious living room dining room combo upon entering the home, beautiful parquet hardwood flooring throughout the lovely kitchen which opens up to a large family room with wood burning fireplace, spacious bedrooms, and an incredible backyard complete with covered patio, perfect for entertaining and more.

OPEN HOUSE SAT & SUN 1-4
Sept 26 and Sept 27

 

 

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